Gov’t gives extension to Anaklia Development Consortium to raise capital by year end

"Despite the fact that the Georgian government has the right to cancel the investment agreement [signed between the parties on October 3, 2016 for the construction of Anaklia Port], given that this project is important [to the government], it will allow consortium to raise their own capital and receive loans from international banks”, said Minister of Infrastructure Maia Tskitishvili. Photo: Anaklia Development Consortium.

Agenda.ge, 16 Oct 2019 - 13:21, Tbilisi,Georgia

The Georgian Ministry of Infrastructure has announced the government will allow the Anaklia Development Consortium to try to come up with the needed capital for the project by the end of the year.

The ministry announced it will not cancel the current investment agreement despite the expired deadline for the consortium to finalise agreements with potential investors and financial institutions to bring in $520 million in total in investments. 

Georgian Infrastructure Minister Maia Tskitishvili has denied the consortium's allegation that the government has been purposefully sabotaging the project.  

Despite the fact that the Georgian government has the right to cancel the investment agreement [signed between the parties on October 3, 2016 for the construction of Anaklia Port], given that this project is important [to the government], it will allow consortium to raise their own capital and receive loans from international banks”, said Minister of Infrastructure Maia Tskitishvili.

Tskitishvili urged the Anaklia Development Consortium to make publicise a letter it recently sent to the government, as the government does not have the right to speak about the letter per the agreement. 

Georgian Infrastructure Minister Maia Tskitishvili has denied the consortium's allegation that the government has been purposefully sabotaging the project.  Photo: Anaklia Port. 

General director of the Anaklia Development Consortium Levan Akhvlediani noted that this letter concerns project development prospects, while Tskitishvili says that there are no specific visions and plans for the project in the letter. 

The deadline for Anaklia Development Consortium to finalise agreements with potential investors and financial institutions to bring in $520 million in total in investments was October 15. 

Specifically, the consortium was supposed to have submitted signed documents with international financial institutions for $400 million in loans and with investors for capital of $120 million.

Construction of Anaklia Deep Sea Port started in 2017, with the opening of the port and the receiving of ships in Anaklia planned for 2021. Photo: Anaklia Port. 

The Anaklia Development Consortium won the state tender to construct the port and signed a deal with the government in 2016 with TBC Holding as its principal partner, but has faced problems in attracting the $2.5 billion in funds needed to construct the port. 

Construction of Anaklia Deep Sea Port started in 2017, with the opening of the port and the receiving of ships in Anaklia planned for 2021. 

The latest timeline presented by the consortium says that the construction of the port will be completed in June of 2022 instead of 2020, announced the Ministry of Infrastructure on July 30.

Despite support from the government, the project has so far failed to obtain the needed $400 million in loans from international financial institutions and to put forward its own capital of $120 million.

The deadline for obtaining the funding has been postponed several times and the consortium was to have met this obligation by the end of 2019.